“How can I do my end of month sales forecast for The Exec, when you guys don’t input or update your % probabilities of conversion into your pipeline tracker!”… laments the frustrated Head of Sales to his brow-beaten Sales Execs at the monthly sales meeting.

Sadly… a common lament.

Yet so many imploring Heads of Sales do not understand that there is a fundamental flaw in this corollary…yes! They should demand that their Sales Execs keep the % probability conversions for each opportunity in the pipeline up to date … but no! Not to use it create the sales forecast!

A best-of-class sales opportunity pipeline in a B2B sales organisation should have two separate, parallel sets of metrics. One set should measure the % progression at each gate and therefore also overall % conversion, as well as number/rate in the top and number rate converted out the bottom. The other set should measure the aforementioned % probability of each opportunity at any point in time. Too often, as per my little role play above, Australian B2B sales organisations establish the former, but not the latter. And this is a great shame. Let me explain by comparing and contrasting the parallel metrics … progression rates vs probability rates.

  • Progression rates are formulaic and automatically measured and updated by the CRM/opportunity tracker by virtue of Sales Execs keying into CRM/opportunity tracker the movements of their “owned” opportunities through gates or out of the pipeline at specific gates where the “escape” has occurred
  • Probability rates are judgmental and assessed by the “owning” Sales Exec, reflecting the belief at any time of ultimate conversion probability of each opportunity
  • Probability rates and are updated manually any time that the Exec assesses there has been a change in the ultimate probability of that opportunity converting
  • Probability rates DO NOT adequately fulfill any of these deliverables, and are ONLY useful to assist the “owning” Sales Exec prioritise sales activities in the personal planning process
  • Progression rates are based on real actual data (ideally a moving 12 month “window” of data), and therefore show real progression rates at each gate, because they reflect the actual reality of the past year’s success of all opportunities that approach each gate, and the proportion that pass versus the proportion that escape
  • Because progression rates are based on real, hard data (progression, conversion, rate in, rate out) they are magnificent data for conducting reliable sales forecasting from the pipeline…they are also magnificent for Sales Exec (individual and team levels) performance analysis and coaching, because they show at which gates performance is high and at which gates it is low

The trap that lures too many Heads of Sales, is that probability rates are easier to establish and execute. Progression rates require some design, coding into the CRM, and new report construction. But the effort is worth it. Don’t take my word for it…try it and see for yourself.